Aker Seafoods: Profitability improved in Norway

February 21, 2011 10:17

Aker Seafoods achieved a significant improvement in operating profit during 2010, and delivered an EBITDA of 250 million kroner. That compares with 192 million kroner for 2009, and represents the company's best-ever result. EBITDA for the fourth quarter of 2010 was 42 million kroner, down 51 million from the same period the year before. The EBITDA margin was six per cent, compared with seven per cent in the same period of 2009. Profitability strengthened for harvesting and processing in Norway, but margins weakened in Denmark and France, reports www.megafishnet.com with reference to Aker Seafoods.

Sales for Aker Seafoods came to 702 million kroner in the fourth quarter, compared with 727 million in the same period of 2009. This reduction reflects both a lower harvested volume and a smaller output of fillet products.

"Viewed as a whole, 2010 was the best year we've ever had," says Thomas Farstad, chief executive of Aker Seafoods. "We made progress in Norway, but had a downturn in our international operations.

"During the fourth quarter, we experienced efficient harvesting and improved prices even though our quotas for the period were smaller than in 2009. The Norwegian processing business also achieved positive results in the quarter despite weak supplies of raw material."

Profit before financial items (EBIT) for the quarter came to nine million kroner, compared with a loss of 29 million in 2009. Earnings per share were 0.11 kroner. Cash flow from operations was 87 million kroner as against 196 million in the fourth quarter of 2009. Net financial items broke even, compared with costs of 24 million in 2009. Net interest-bearing debt declined from 1 067 million kroner at 30 September to 995 million at 31 December.

The equity ratio was 38.3 per cent at 31 December, compared with 36.2 per cent three months earlier.

Aker Seafood's harvesting segment achieved an operating profit before depreciation and amortisation (EBITDA) of 34 million kroner, compared with 26 million in the same period of 2009, and catches were down 18 per cent. For the full year, it had an EBITDA of 176 million compared with 125 million in 2009.

The Norway Seafoods marketing and processing company, which embraces the Norway, Denmark and France segments, reported an EBITDA of eight million kroner for the fourth quarter, compared with 25 million in the same period of 2009. EBITDA was six million kroner for the Norwegian processing business compared with a negative two million the year before, three million kroner for the Danish business compared with six million, and negative at one million kroner for the French business compared with a positive 21 million. For the full year, Norway Seafoods had an EBITDA of 75 million kroner compared with 67 million in 2009.

Aker Seafoods expects good catches for its own fleet in 2011, with the quota base for cod and haddock increased by 23 and 24 per cent respectively. Supplies of raw material for Norway Seafoods are expected to be good in the first half. The company will strengthen its commitment to sales and market development, but expects the margin position for seafood processing to remain demanding.

"The outlook for fishing is good, and we expect increased profitability in the harvesting segment during 2011," says Mr Farstad. "We're enhancing the efficiency of our fleet while anticipating higher catch rates per operating day. Margins for seafood processing will remain demanding, but we're confident of achieving an improvement through an increased commitment to market work and actions to improve operations."

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